BLACKLEDGE v. UNITED PARCEL SERVICE, INC.

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF INDIANA

INDIANAPOLIS DIVISION

GARY BLACKLEDGE, )

RICK EDDELMAN, )

)

Plaintiffs, )

)

v. ) No. 1:22-cv-01947-SEB-MG

)

UNITED PARCEL SERVICE, INC., )

UPS PENSION PLAN, )

UPS PARCEL, )

UPS FREIGHT, )

TRUSTEES OF THE UPS PENSION PLAN, )

PLAN ADMINISTRATOR OF THE UPS )

PENSION PLAN, )

)

Defendants. )

ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

Plaintiffs Gary Blackledge ("Mr. Blackledge") and Rick Eddelman ("Mr. Eddel-

man") (collectively "Plaintiffs") brought this action against Defendants United Parcel Ser-

vice, Inc., UPS Ground Freight, Inc., the UPS Pension Plan, and the UPS Pension Plan's

Board of Trustees as Plan Administrator (collectively, "Defendants")1 for their alleged vi-

olations of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001,

1 On August 30, 2024, we ordered the parties to file a Joint Statement clarifying/correcting the

identities of named Defendants. Plaintiffs originally named as Defendants non-juridical entities

"UPS Parcel" and "UPS Freight." However, the parties now agree that the correct Defendants are

"United Parcel Service, Inc." and "UPS Ground Freight, Inc.," respectively. Dkt. 112. (Plaintiffs

nevertheless maintain that "United Parcel Service, Inc. and UPS Ground Freight, Inc., are subsid-

iaries of United Parcel Service, Inc." Id.) Plaintiffs also named "Trustees of the UPS Pension Plan"

and "Plan Administrator of the UPS Pension Plan" separately, despite appearing to be one and the

same entity. Unfortunately, the parties' Joint Statement offered little clarification, confirming

simply that the Board of Trustees is the Plan Administrator.

et seq., the Indiana Wage Payment Act ("IWPA"), Ind. Code § 22-2-5-1, et seq., and the

Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 203, et seq. Defendants have moved for

summary judgment on all claims. Dkt. 72. For the reasons explained below, their motion is

GRANTED.

LEGAL STANDARD

Summary judgment is proper when "the movant shows that there is no genuine dis-

pute as to any material fact and that the movant is entitled to judgment as a matter of law."

Fed. R. Civ. P. 56(a). The summary judgment standard requires "no genuine issue of mate-

rial fact," meaning that "the mere existence of some alleged factual dispute between the

parties will not defeat an otherwise properly supported motion for summary judgment."

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247−48 (1986) (emphasis in original). Ma-

terial facts are those that "might affect the outcome of the suit," and a dispute of material

fact is genuine when "a reasonable jury could return a verdict for the nonmoving party."

Id. at 248.

Because summary judgment is not "a vehicle for resolving factual disputes," the

district court need not "sift through the evidence, pondering the nuances and inconsisten-

cies, and decide whom to believe." Waldridge v. Am. Hoechst Corp., 24 F.3d 918, 920 (7th

Cir. 1994). Indeed, those tasks belong to the factfinder. Miller v. Gonzalez, 761 F.3d 822,

827 (7th Cir. 2014). "The court has one task and one task only: to decide, based on the

evidence of record, whether there is any material dispute of fact that requires a trial."

Waldridge, 24 F.3d at 920 (citing Anderson, 477 U.S. at 249–50). When deciding whether

a genuine dispute of material fact exists, the court construes all facts in the light most

favorable to the non-moving party and draws all reasonable inferences in that party's favor.

Khungar v. Access Cmty. Health Network, 985 F.3d 565, 572 (7th Cir. 2021).

BACKGROUND

Messrs. Blackledge and Eddelman are former UPS Ground Freight, Inc. ("UPS

Freight") delivery drivers who resigned from their UPS Freight positions to become em-

ployed as United Parcel Service, Inc. ("United Parcel") delivery drivers. Both employers

are parties to separate collective bargaining agreements, each of which authorizes covered

employees to participate in distinct pension plans. By starting new jobs with United Parcel,

Plaintiffs lost their seniority and related service credits which they had accrued as UPS

Freight employees. Their intent in filing the instant lawsuit is to recover those benefits.

I. The Applicable Collective Bargaining Agreements

Pertinent to the dispute before us are two collective bargaining agreements both in

effect from August 2018 through July 2023: First, the National Master UPS Freight

Agreement ("Freight CBA"), which outlines the terms and conditions of employment

with UPS Freight; and second, the National Master United Parcel Service Agreement

("United Parcel CBA"), which outlines the terms and conditions of employment with

United Parcel. Neither UPS Freight nor United Parcel is a party to the other's collective

bargaining agreement. Faulstick Decl. ¶ 3, 5, dkt. 110-2 (Declaration of United Parcel's

Labor Manager, Matt Faulstick).

The United Parcel CBA was subsequently supplemented by two additional agree-

ments: the Local No. 135 Rider to the UPS National Master Agreement ("Local

Rider") and the Teamsters Central Region and United Parcel Service Supplemental

Agreement ("Central Region Supplement"). In interpreting various provisions of these

agreements, if conflicts arise among them, the following order of precedence controls in

fashioning a solution: first the Local Rider, then the Central Region Supplement, and last

the United Parcel CBA.

A. Progression & Reciprocity

Through a process called "progression," both UPS Freight and United Parcel em-

ployees qualify for incrementally higher wages based on their years of service, until they

hit the highest level. Absent a so-called "reciprocity agreement," an employee who leaves

one UPS-affiliated employer to work for another effectively forfeits his progression rank

and begins progression anew.

There are no reciprocity agreements under the Freight CBA, meaning that former

UPS Freight employees cannot transfer their progression rank to their next job with a UPS-

affiliated employer. Article 41 of the United Parcel CBA, by contrast, provides that "[n]o

employee shall be required to complete a full-time progression more than one (1) time even

if he or she transfers between full-time jobs" within the same company. Dkt. 110-4 at 179;

Faulstick Decl. ¶ 15, dkt. 110-2. The Central Region Supplement provides that United Par-

cel and Plaintiffs' union, the International Brotherhood of Teamsters (the "Union"), "agree

that they will undertake to attempt to establish appropriate reciprocity agreements to pro-

tect the pension rights of employees." Dkt. 110-5 at 31; see also Blackledge Dep. 134:5–

8, dkt. 110-13 (acknowledging the same). However, no such reciprocity agreement was

ever reached.

In 2020, a Florida-based United Parcel driver, who (like Plaintiffs) had previously

worked for UPS Freight, invoked Article 41 of the United Parcel CBA to challenge his loss

of progression rank (and associated benefits) that he had accrued from his prior employ-

ment with UPS Freight. The Southern Region Area Parcel Grievance Committee ultimately

denied his claim and subsequent appeal, concluding that Article 41 does not require United

Parcel to honor seniority and/or other entitlements earned from prior service with UPS

Freight. Both Plaintiffs before us work within the Central Region. Defendants maintain

that United Parcel and the Union have uniformly applied the ruling in the 2020 Southern

Region case on a national basis. Faulstick Decl. ¶ 22, dkt. 110-2; see also Blackledge Dep.

134:13–15 (stating that "Central Region . . . would apply to me and my area," but "Southern

Region" would not).

B. United Parcel CBA Grievance Procedure

The Local Rider to the United Parcel CBA sets forth the pertinent grievance proce-

dures intended to resolve "any controversy, complaint, misunderstanding, or dispute" con-

cerning the applicable labor agreements. Dkt. 110-6 at 23. "Grievance procedures may be

invoked only by authorized Union or Employer representatives" in the following manner:

First, the employee must raise his complaint with his immediate supervisor. Id. at 23–24.

Thereafter, the employee may discuss the matter with the shop steward as well as the shop

steward's immediate supervisor. If the parties cannot reach an agreement, the shop steward

is directed to "promptly submit the written grievance . . . to management and the union."

Id. at 24. Unless the parties otherwise reach an agreement, the grievance "shall be submitted

to the state committee," and, if the state committee is unsuccessful, "the grievance will be

submitted to the UPS Joint area Committee." Id.

II. The Pertinent Pension Plans

A. UPS Pension Plan

The Freight CBA covers UPS Freight employees entitled to participate in the UPS

Pension Plan (the "Plan"), a UPS-sponsored employee pension plan subject to ERISA

and administered by the Board of Trustees (hereinafter "Trustees" or "Plan Administrator").

The Plan provides various benefits to employees occupying collectively bargained posi-

tions at UPS Freight, which positions are detailed in Benefit Schedule S of the Plan, entitled

as "UPS Ground Freight Employees International Brotherhood of Teamsters (UE Plan)."

Hinson Decl. ¶ 6, dkt. 110-9 (Declaration of United Parcel's Retirement Benefits Director,

Jarett Hinson); Dkt. 110-10 at 191. The benefits available to plan participants are affected

by "service credit," or the "years and months of credit for work . . . , which are accumulated

and maintained for employees . . . for all purposes other than eligibility . . . and vesting."

Dkt. 110-10 at 20. The Plan specifically allows service credit earned by UPS Freight em-

ployees, as directed by the Freight CBA.

Plan participants qualify for receipt of their pension benefits by (1) formally termi-

nating their employment with UPS Freight and/or any "Related Employer"; and (2) having

met the normal retirement age of sixty-five years. For the limited purpose of identifying

plan participants' termination dates (and, thus, their eligibility for pension benefits), UPS

Freight and United Parcel are treated as "Related Employers." Hinson Decl. ¶ 19, dkt. 110-

9.

In October 2019, the Plan was amended by adding the 2019 Lump Sum Distribution

and Immediate Annuity Window (the "2019 Window"), according to which those qualify-

ing plan participants (or their surviving spouses) could elect an immediate lump sum dis-

tribution of their entire vested retirement benefit or an immediate annuity thereof. The 2019

Window extended from October 7, 2019, through November 16, 2019, for plan participants

who had terminated their employment with UPS Freight and/or a Related Employer on or

before May 1, 2016. Neither Mr. Blackledge nor Mr. Eddelman qualified for receipt of Plan

benefits during the 2019 Window because each was employed by United Parcel, a Related

Employer.

Otherwise, "to receive any benefits or to take any other action under the Plan," par-

ticipants "must file the appropriate forms with the Plan Administrator." Dkt. 51-3 at 20.

After "receipt of a notification of an adverse determination," plan participants have a right

to file an appeal with the Plan Administrator, who retains "the exclusive right to interpret

the Plan." Id. at 18, 21–22. Thereafter, plan participants are deemed to have exhausted their

administrative remedies and may proceed to file a civil action in court, if they wish to do

so. Id. at 22.

B. Local 710 Pension Fund

The Local Rider to the United Parcel CBA covers United Parcel employees entitled

to participate in the Local 710 IBT Pension Plan ("Local 710 Pension Fund"), a union-

sponsored pension fund that provides benefits to the employees of United Parcel and other

UPS-related entities, as specified by the United Parcel CBA and supplemental agreements.

Hinson Decl. ¶ 7–8, dkt. 110-9. United Parcel's monetary contributions to the Local 710

Pension Fund match the service credits earned by its employees. As a non-UPS-sponsored

pension plan, the Local 710 Pension Fund retains the final authority on service credit de-

terminations. Id. ¶ 10.

III. Plaintiffs' Employments

A. Mr. Blackledge

Mr. Blackledge was hired by UPS Freight in August 2010, at which time he began

accruing service credits under the Plan, as outlined by the Freight CBA.

In March 2017, non-party Jeff Combs ("Mr. Combs"), the Secretary Treasurer of

Local No. 135, approached Mr. Blackledge with a proposal that he leave UPS Freight and

join United Parcel on the promise of higher pay. To effect this transition, Mr. Blackledge

signed and submitted a resignation letter, knowing that he would start at United Parcel as

a seasonal driver and that his progression and seniority rank would restart. Blackledge Dep.

33:3–4, dkt. 110-13 (recounting that he "would start over in [his] seniority and pay"). In

late September 2017, when Mr. Blackledge formally resigned from his position at UPS

Freight, he had accrued 7.5 years of service credit under the Plan, entitling him to a $609.00

monthly pension benefit for life beginning at age sixty-five.

In October 2017, Mr. Blackledge began working for United Parcel as a seasonal

driver and, by February 2018, had become a full-time driver. (Mr. Blackledge has not chal-

lenged his interim status as a seasonal driver. Id. at 130:20–131:7.) By February 2022, Mr.

Blackledge had completed progression and reached the top rate of pay in his classification.

In September 2018, March 2020, and August 2020, Mr. Blackledge requested and

timely received Plan information from the Plan Administrator. Id. at 55:21–56:17

(September 2018); id. at 64:24–65:2 (March 2020); id. at 63:2–64:2 (August 2020); Dkt.

110-16 (August 2020 email exchange).2 On February 24, 2021, Mr. Blackledge, through

counsel, emailed the Trustees a "letter of appeal" based on "the refusal of the UPS Pension

Plan to consider [Mr. Blackledge's] years of service with UPS Freight in calculating his

benefits under the UPS Pension Plan." Dkt. 51-1 at 2. According to the letter of appeal,

"Mr. Blackledge requested a retirement buyout from UPS Freight but was told that he has

never left the company and does not qualify for a buyout." Id. Although labeled as a "letter

of appeal," there is no evidence that Mr. Blackledge submitted a claim to the Plan Admin-

istrator, in accordance with the Plan's claim procedure, nor does Mr. Blackledge identify

any Plan provision purporting to promise a "buyout." Mr. Blackledge ultimately never re-

ceived a response to his letter of appeal. Blackledge Aff. ¶ 26, dkt. 80-1.

In March 2021, Mr. Blackledge filed a grievance with the Union, nominally on be-

half of "all individuals, past and present," alleging that United Parcel violated Article 41 of

the United Parcel CBA. Dkt. 110-17 at 2. Mr. Blackledge asserted that, because UPS

Freight and United Parcel are owned and operated "by UPS," he "was a transfer employee"

rather than "a new hire," and thus should not have lost his progression rank and associated

benefits. Id. He sought to be "made whole" through the restoration of "wages, seniority,

insurance benefits, retirement benefits, and all other benefits." Id.

In his deposition testimony, Mr. Blackledge recalled that neither United Parcel nor

his Union "wanted to go anywhere with" his March 2021 grievance, and, as a consequence,

2 Defendants also claim—without an evidentiary citation—that Mr. Blackledge requested Plan in-

formation on January 20, 2020. Defs.' Br. 24, dkt. 110.

he did not receive a timely disposition of his grievance. Blackledge Dep. 88:5–6, dkt. 110-

13. Although Mr. Blackledge's grievance "never progressed" through the procedure set

forth in the Local Rider to the United Parcel CBA (e.g., submission to the UPS Joint com-

mittee and/or the UPS Joint Area committee), a hearing was eventually held on August 25,

2021. Id. at 90:9–10. According to Mr. Blackledge, however, no ruling was ever made.

Blackledge Aff. ¶ 28, dkt. 80-1.

On January 27, 2022, Mr. Blackledge filed an Unfair Labor Practices Charge (the

"Charge") with the National Labor Relations Board (the "NLRB"), averring as follows:

[T]he Union failed to satisfy its duty of fair representation because it refused

to process [Mr. Blackledge's] grievance for arbitrary or discriminatory rea-

sons, or in bad faith. . . . Mr. Blackledge alleges that the Union has failed or

refused to take the grievance to state panel after the Employer refused to an-

swer the grievance.

Dkt. 110-8 at 7. On February 22, 2022, after Mr. Combs scheduled a meeting with Mr.

Blackledge re: the March 2021 grievance, Mr. Blackledge withdrew the Charge against the

Union.3

B. Mr. Eddelman

Mr. Eddelman was hired by UPS Freight in July 2008, at which time he began ac-

cruing service credit under the UPS Pension Plan. In June 2019, Mr. Eddelman terminated

his employment with UPS Freight with 11.6 years of service credit under the UPS Pension

Plan, entitling him to a $974.00 monthly pension benefit for life, payable at age sixty-five.

3 In his deposition testimony, Mr. Blackledge stated that he withdrew his Charge only with respect

to the Union but not with respect to the company. Blackledge Dep. 91:22–25, dkt. 110-13. What-

ever remained of Mr. Blackledge's Charge, it too was eventually dismissed as untimely. Id. at

93:17–19.

In July 2019, Mr. Eddelman was hired by United Parcel. Like Mr. Blackledge, Mr.

Eddelman worked through progression until reaching the top rate of pay in 2023. (Mr. Ed-

delman believes that he was wrongfully made to go through progression, resulting in his

underpayment). As an employee of United Parcel, Mr. Eddelman received service credit

under the Local 710 Pension Fund.

In April 2020, Mr. Eddelman applied for Plan benefits pursuant to the 2019 Win-

dow's limited-time opportunity available to terminated employees. Dkt. 110-11. The Plan

denied Mr. Eddelman's request as untimely but further explained that his employment with

United Parcel rendered him an "active [e]mployee" and thus ineligible. Id. The Plan's denial

also outlined how to appeal the adverse determination to the Trustees. Mr. Eddelman, how-

ever, never appealed.

IV. Procedural History

On July 29, 2022, Plaintiffs brought this action in state court against Defendants as

well as Teamsters Union Local No. 135 and Brotherhood of Teamsters Union Local 710

Pension Fund (both of which have since been voluntarily dismissed). Defendants timely

removed this matter to federal court on the basis of federal question jurisdiction. In their

operative complaint, Plaintiffs allege that the remaining Defendants violated their rights

under ERISA, the IWPA, and the FLSA. Second Am. Compl. ("SAC"), dkt. 51. On No-

vember 15, 2023, Defendants moved for summary judgment, which motion is now fully

briefed and ripe for ruling.

DISCUSSION

Plaintiffs contend that their progression ranks and service credits should have car-

ried over from UPS Freight to United Parcel. In requiring that they restart progression,

Plaintiffs argue, UPS Freight and United Parcel violated their ERISA rights by refusing to

count their service credits from both employments cumulatively for purposes of their pen-

sion benefits.4 Plaintiffs also assert that United Parcel violated the IWPA and the FLSA.

I. ERISA

Plaintiffs assert a benefits denial claim under 29 U.S.C. § 1132(a)(1)(B) and a fidu-

ciary breach claim under 29 U.S.C. § 1132(a), challenging the loss of their progression

benefits on the grounds that they "never truly resigned" from their positions with UPS

Freight and instead "simply transferred" from UPS Freight to United Parcel. Under their

so-called "single employer" theory, Plaintiffs contend that "all employment indicators"—

including their employee badges, their credentials for accessing their employee portals,

their health insurance and insurance numbers, and their facial hair variances—remained

unchanged, which, in turn, render UPS Freight and United Parcel as the same employer for

purposes of pay and fringe benefits. Because UPS Freight and United Parcel "did not treat

[them] as wholly new employees," Plaintiffs reason, they are entitled to the continuation

4 In the operative complaint, Plaintiffs also alleged that UPS Freight violated the Plan by refusing

to provide them with a buyout one year after they were no longer UPS Freight employees; and that

they are entitled to statutory penalties under 29 U.S.C. § 1132(c)(1). SAC ¶¶ 55–56, dkt. 51. De-

fendants asserted various grounds for the entry of summary judgment on both claims—to which

Plaintiffs offered not a single responsive argument. "A party opposing a summary judgment motion

must inform the trial judge of the reasons, legal or factual, why summary judgment should not be

entered." Robyns v. Reliance Standard Life Ins. Co., 130 F.3d 1231, 1237–38 (7th Cir. 1997) (al-

terations omitted). In light of Plaintiffs' silence, we regard both claims as abandoned and enter

summary judgment in Defendants' favor accordingly. Id.

of their progression benefits as well. Pls.' Resp. Br. 18, dkt. 80. Defendants argue that

Plaintiffs failed to exhaust their administrative remedies with regard to their denial of ben-

efits claim and that, in any event, the benefits denial and fiduciary breach claims ultimately

fail on the merits.

"ERISA's principal function [is] to 'protect contractually defined benefits.' " US Air-

ways, Inc. v. McCutchen, 569 U.S. 88, 100 (2013) (quoting Massachusetts Mut. Life Ins.

Co. v. Russell, 473 U.S. 134, 148 (1985)). "The plan, in short, is at the center of ERISA."

Id. at 101. Consistent with ERISA's directives, courts "rel[y] on the face of written plan

documents." Id. at 100–01 (quoting Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73,

83 (1995)). Our task begins with "enforcing the plan terms as written . . . ." Heimeshoff v.

Hartford Life & Accident Ins. Co., 571 U.S. 99, 108 (2013) (emphasis added).

With these controlling legal principles in mind, we turn to Plaintiffs' claims below.

A. Benefit Denial Claim under § 1132(a)(1)(B)

Plan participants may bring a civil action under ERISA "to recover benefits due to

[them] under the terms of [their] plan, to enforce [their] rights under the terms of the plan,

or to clarify [their] rights to future benefits under the terms of the plan." 29 U.S.C. §

1132(a)(1)(B). Where, as here, the pension "plan grants to its administrator the discretion

to construe the plan's terms, then the district court must review the denial of benefits def-

erentially, asking only whether the plan's decision was arbitrary and capricious." Hess v.

Reg-Ellen Mach. Tool Corp. Emp. Stock Ownership Plan, 502 F.3d 725, 727 (7th Cir.

2007). "[B]ecause ERISA directs employee benefit plans to provide adequate written no-

tice of the reasons for denials of claims by plan participants and to create procedures for

the review of such denials of claims," the Seventh Circuit "require[es] exhaustion of ad-

ministrative remedies as a prerequisite to bringing suit." Edwards v. Briggs & Stratton Ret.

Plan, 639 F.3d 355, 360 (7th Cir. 2011).

The exhaustion requirement "encourages informal, non-judicial resolution of dis-

putes about employee benefits." Id. Congress intended administrative remedies "to help

reduce the number of frivolous lawsuits under ERISA; to promote the consistent treatment

of claims for benefits; to provide a nonadversarial method of claims settlement; and to

minimize the cost of claims settlement for all concerned." Id. (quoting Kross v. Western

Elec. Co., Inc., 701 F.2d 1238, 1244–45 (7th Cir. 1983)). Even where the administrative

process "proves unavailing," exhaustion nonetheless "prepare[s] the ground for litigation,"

ensuring that the parties have developed a full factual record that further enables courts to

take advantage of agency expertise. Id. at 361.

The Seventh Circuit has "consistently held that the decision to require exhaustion in

a given case is committed to a district court's discretion." Id. at 365 n.5. Typically, "a failure

to exhaust administrative remedies will be excused in few limited circumstances—when

resort to administrative remedies would be futile, when the remedy provided is inadequate,

or where there is a lack of access to meaningful review." Orr v. Assurant Emp. Benefits,

786 F.3d 596, 602 (7th Cir. 2015) (internal citations omitted).

Turning to the case at bar, the claims procedure set forth in the Plan provides that

participants "must file the appropriate forms with the Plan Administrator to receive any

benefits or to take any other action" thereunder. Dkt. 51-3 at 20. Filing a claim requires

participants to "submit [their] request in writing" to the Plan Administrator. Participants

may, within sixty days of notification of an adverse determination, elect to bring an appeal,

at which point the claims and appeals procedure has been exhausted and participants are

entitled to file a claim in state or federal court. Id. at 22 ("You must exhaust the Plan's

claims and appeals procedures before filing any civil action."); id. at 23 ("If you have a

claim for benefits which is denied or ignored, in whole or in part, you may file suit in a

state or Federal court, but only after you have exhausted the Plan's claims and appeals

procedures.").

Plaintiffs contend that they exhausted any and all administrative remedies available

to them under the Plan, as evidenced (according to Plaintiffs) by Mr. Blackledge's March

2021 Union grievance and his "letter of appeal" to the Plan. (Plaintiffs do not put forth an

independent argument with regard to Mr. Eddelman's administrative exhaustion.) Because

the record before us provides no evidence of any such compliance with the Plan's claim

procedure, Plaintiffs' argument is unavailing.

Mr. Blackledge insists that he properly exhausted his administrative remedies under

the Plan when he filed a Union grievance in March 2021 and later attempted to appeal to

the Plan through his February 2021 "letter of appeal." Pls.' Resp. Br. 21, dkt. 80. Aside

from the chronological discrepancy reflected in the timing of the purported appeal (in Feb-

ruary) having preceded Mr. Blackledge's Union grievance (in March), Mr. Blackledge ap-

pears to have conflated the grievance procedure set forth under the United Parcel CBA with

the benefits claims procedure set forth under the Plan. The United Parcel CBA outlines the

terms and conditions for employment with United Parcel and further provides for United

Parcel employee participation in the Local 710 Pension Fund. The Plan, by contrast, is the

pension benefit plan available for employees of UPS Freight whose employment is covered

by the Freight CBA. In short, the United Parcel CBA grievance procedure is legally distinct

from the Plan's claims procedure, and Mr. Blackledge offers no explanation as to how a

CBA grievance (submitted to his Union) somehow translates to a claim for benefits (sub-

mitted to the Plan Administrator).

In sum, the Plan clearly and explicitly requires plan participants to submit the ap-

propriate claim forms to the Plan Administrator before taking any other action, including

bringing a lawsuit in federal court, dkt. 51-3 at 20–23, and Mr. Blackledge has adduced no

evidence establishing that he did in fact do so.5 Having failed to submit the appropriate

claim form, Mr. Blackledge unsurprisingly did not receive an appealable adverse determi-

nation. Consistent with our legal obligation to "enforc[e] the plan terms as written,"

Heimeshoff, 571 U.S. at 108, we conclude that Mr. Blackledge did not comply with the

Plan's claim procedure and thus did not exhaust his administrative remedies.

As for Mr. Eddelman, Plaintiffs do not assert, nor does our review of the record

suggest, that Mr. Eddelman exhausted his administrative remedies. Although Mr. Eddel-

man submitted a claim for benefits within the 2019 Window, it is undisputed that he did

not appeal the adverse determination he ultimately received. As such, he as well did not

exhaust his administrative remedies.

5 Although Mr. Blackledge did submit written requests for information and estimates to the UPS

Pension Plan on three separate occasions (September 19, 2018, March 5, 2020, and August 7,

2020), it remains undisputed that he never filed a claim for benefits actionable under §

1132(a)(1)(B).

Plaintiffs nonetheless argue that they should be excused from the administrative ex-

haustion requirement because any attempt to do so would have been futile, given Defend-

ants' "contention that the [pension] plans are distinct and [that] UPS Freight and [United]

Parcel are distinct, not a single, employer." Pls.' Resp. Br. 21, dkt. 80.

"Futility is demonstrated by showing that it is 'certain' a plaintiff's claim will be

denied by the plan administrator." Ruttenberg v. U.S. Life Ins. Co. in City of New York, a

subsidiary of Am. Gen. Corp., 413 F.3d 652, 662 (7th Cir. 2005) (quoting Robyns, 130 F.3d

at 1238). Bald allegations, conclusory statements, nor mere doubts that continued pursuit

of administrative remedies will result in a different outcome suffice to demonstrate futility.

Zhou v. Guardian Life Ins. Co. of Am., 295 F.3d 677, 680 (7th Cir. 2002). Indeed, when a

party "proffer[s] no facts indicating that the review procedure that he initiated will not

work, the futility exception [simply] does not apply." Id. Additionally, "when a claimant

ignores the administrative remedies and proceeds directly to federal court, he cannot be

allowed to justify his choice by the fact that the plan defended itself in the lawsuit." Stark

v. PPM Am., Inc., 354 F.3d 666, 672 (7th Cir. 2004). "Once battle is joined, positions cal-

cify." Id. A plan's litigation strategy enforcing the terms as written, therefore, does not serve

as evidence of futility.

So, again, applying these principles to the case at bar, we find no evidence of futility

to justify waiver of the exhaustion requirement. Plaintiffs' sole argument is that, "[b]ased

on the UPS Defendants' own assertions and argument in their summary judgment brief,

had Plaintiffs pursued those internal remedies, they clearly would not have been successful

because the UPS Defendants point to each other['s] ERISA plans as proof for denying

Plaintiffs' claims." Pls.' Resp. Br. 22, dkt. 80. Plaintiffs maintain that Defendants' positions

taken throughout the course of litigation evince the futility of their hypothetical efforts to

comply with the internal procedures under the Plan.

Plaintiffs' argument is unavailing for the simple reason that Defendants' litigation

advocacy cannot—and therefore does not—justify circumventing administrative proce-

dures, especially where, as here, Plaintiffs adduce no evidence of their having ever at-

tempted to submit the correct claims forms for the benefits the seek in the instant lawsuit.

Accordingly, we find that Plaintiffs have not demonstrated futility.

Accordingly, in the exercise of our discretion, we hold that Plaintiffs' failure to ex-

haust their administrative remedies entitles Defendants to the entry of summary judgment

on Plaintiffs' denial of benefit claim.

A. Breach of Fiduciary Duty under § 1132(a)

Before turning to the merits of Plaintiffs' fiduciary breach claim, we pause briefly

to clarify the relevant controlling statute. In framing their fiduciary breach claim, Plaintiffs

cited § 1132(a) generally, SAC ¶ 53, dkt. 51, without specifying which of the six potential

civil actions authorized therein they intend to assert. LaRue v. DeWolf, Boberg & Assocs.,

Inc., 552 U.S. 248, 253 (2008). Defendants construed Plaintiffs' fiduciary breach claim as

arising under § 1132(a)(3), which "authorizes civil actions for violations of the provisions

of ERISA itself" as well as the terms of the plan. Kross, 701 F.2d at 1244. In their respon-

sive brief, Plaintiffs (without elaborating) pegged their fiduciary breach claim to §

1132(a)(2), which permits the Secretary of Labor, plan participants, beneficiaries, and fi-

duciaries "to bring actions on behalf of a plan to recover for violations of the obligations

defined in § 409(a)," codified at 29 U.S.C. § 1109(a). LaRue, 552 U.S. at 253 (emphasis

added). Plaintiffs, however, have not brought claims on the Plan's behalf, alleged a plan-

wide breach, or asserted violations of § 1109(a). Pls.' Resp. Br. 17, dkt. 80 (discussing duty

of loyalty defined in § 1104(a)). Accordingly, we construe Plaintiffs' fiduciary breach claim

as arising under § 1132(a)(3)—not § 1132(a)(2). See Mondry v. Am. Fam. Mut. Ins. Co.,

557 F.3d 781, 804 (7th Cir. 2009) (describing § 1132(a)(3) as "an appropriate vehicle for

remedying a breach of the fiduciary obligations owed to plan participants") (citing Varity

Corp. v. Howe, 516 U.S. 489, 507–15 (1996)); e.g., Schatzel v. Cent. States Se. & Sw. Areas

Pension Fund, 941 F. Supp. 2d 999, 1007–08 (N.D. Ill. 2013).

To establish a breach of fiduciary duty under ERISA, a plaintiff must show (1) that

the defendant is a plan fiduciary; (2) that the defendant breached its fiduciary duty; and (3)

that the breach resulted in harm to the plaintiff. Dean v. Nat'l Prod. Workers Union Sever-

ance Tr. Plan, 46 F.4th 535, 546 (7th Cir. 2022).6 ERISA imposes on plan fiduciaries the

duty of loyalty, according to which the fiduciary must "act 'for the exclusive purpose' of

providing benefits to participants." Allen v. GreatBanc Tr. Co., 835 F.3d 670, 678 (7th Cir.

2016) (quoting 29 U.S.C. § 1104(a)(1)(A)–(B)). "ERISA authorizes an award of equitable

relief alone to a plan participant suing on her own behalf for breach of fiduciary duty."

Kenseth v. Dean Health Plan, Inc., 610 F.3d 452, 464 (7th Cir. 2010).

6 We recognize that courts in this Circuit prefer (but do not necessarily require) administrative

exhaustion when plaintiffs assert breach of fiduciary duty claims. See Lindemann v. Mobil Oil

Corp., 79 F.3d 647, 650 (7th Cir. 1996); e.g., Baird v. Steel Dynamics, Inc., No. 1:23-CV-00356-

CCB-SLC, 2024 WL 3983741, at *3 (N.D. Ill. Aug. 29, 2024). Here, however, Defendants have

not raised an exhaustion argument with regard to Plaintiffs' fiduciary breach claim.

"Equitable relief under section 1132(a)(3) is available only when Congress did not

provide relief elsewhere." Griffin v. TeamCare, 909 F.3d 842, 846 (7th Cir. 2018). "[A]

majority of circuits are of the view that if relief is available to a plan participant under

subsection (a)(1)(B), then that relief is unavailable under subsection (a)(3). Mondry, 557

F.3d at 805 (citing Korotynska v. Metro. Life Ins. Co., 474 F.3d 101, 106 (4th Cir. 2006)

(collecting cases)). Thus, where an ERISA plaintiff can attain an adequate remedy under §

1132(a)(1)(B), he cannot repackage his benefit denial claim as a fiduciary breach claim

under § 1132(a)(3).

Applying these principles to the case at bar, Plaintiffs cannot pursue their fiduciary

breach claim because § 1132(a)(1)(B) provides the remedy they seek (i.e., additional ser-

vice credits) for the alleged denial of benefits. Although the Seventh Circuit itself has "not

had occasion to consider th[e] question," Plaintiffs here have "given us no reason to depart

from the holdings of those circuits" that have barred ERISA plaintiffs from sustaining du-

plicative claims under subsections (a)(1)(B) and (a)(3). Id.; see Griffin, 909 F.3d at 846; cf.

Mink v. Barth Elec. Co., Inc., 685 F. Supp. 2d 914, 935 (S.D. Ind. 2010) (failure to respond

to moving party's argument on summary judgment justifies treating issue as waived).7

II. Wage Claims

Plaintiffs assert that United Parcel compensated them at hourly rates lower than

those required by the United Parcel CBA, in violation of the Indiana Wage Payment Act

7 We would reach the same conclusion even if we reviewed Plaintiffs' claim under § 1132(a)(2).

See LaRue, 552 U.S. at 258–59 (Roberts, C.J., concurring) ("Allowing a [1132(a)(1)(B)] action to

be recast as one under § [1132(a)(2)] might permit plaintiffs to circumvent safeguards for plan

administrators that have developed under § [1132(a)(1)(B)].").

and the Fair Labor Standards Act. Defendants argue that Plaintiffs' wage claims fail because

resolution of both requires interpretation of the United Parcel CBA and can be resolved

only through the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185.

A. IWPA

The IWPA imposes a duty on Indiana employers to pay all wages due to employees,

specifically mandating employers to "pay each employee at least semimonthly or biweekly,

if requested, the amount due the employee." I.C. § 22-2-5-1. It further provides that pay-

ments "shall be made for all wages earned to date not more than ten (10) business days

prior to the date of payment." Id. A noncompliant employer becomes "liable to the em-

ployee for the amount of unpaid wages." Id. § 22-2-5-2. In interpreting the IWPA, the In-

diana Supreme Court has concluded that the statutory language "unambiguously estab-

lishes that the legislature intended [it] to govern not only the frequency but also the amount

an employer must pay its employee." St. Vincent Hosp. & Health Care Ctr., Inc. v. Steele,

766 N.E.2d 699, 704 (Ind. 2002).

Where resolution of a state law wage claim "depends on the meaning of, or requires

the interpretation of, a collective bargaining agreement, the application of state law

is preempted[,] and federal labor law principles must be employed to resolve the dis-

pute." Atchley v. Heritage Cable Vision Assocs., 101 F.3d 495, 499 (7th Cir. 1996) (citation

omitted). Specifically, § 301 of the LMRA, 29 U.S.C. § 185(a), "provides that suits for

violation of contracts between an employer and a labor organization confer original juris-

diction in federal district courts, [and] has complete preemption force." Id. at 498. "[T]he

preemptive force of § 301 is so powerful [so] as to displace entirely any state cause of

action for violation of contracts between an employer and a labor organization." Atchley v.

Heritage Cable Vision Assocs., 904 F. Supp. 870, 874 (N.D. Ind. 1995), aff'd, 101 F.3d 495

(7th Cir. 1996), and aff'd, 101 F.3d 495 (7th Cir. 1996).

While the LMRA's preemptive force is broad, it is not automatic. Atchley, 101 F.3d

at 499. Nothing in a collective bargaining agreement can exempt an employer from state

laws of general application, nor may a collective bargaining agreement be utilized to over-

ride the substantive protections provided by state law. Spoerle v. Kraft Foods Glob., Inc.,

614 F.3d 427, 430 (7th Cir. 2010). Thus, an employee can maintain a state-law cause of

action where the underlying "collective bargaining agreement is merely a tangential con-

sideration . . . or where resort to its provisions is merely pro forma." Atchley, 904 F. Supp.

at 874. In such circumstances, the LMRA will not preempt state law. See Caterpillar, Inc.

v. Williams, 482 U.S. 386, 396 (1987).

Here, United Parcel argues that the LMRA preempts Plaintiffs' IWPA claim because

any resolution will turn on interpretation of disputed provisions in the United Parcel CBA.

Plaintiffs contend that their IWPA claim (based on United Parcel's alleged failure to timely

pay the correct wages) is not preempted because "[t]here is simply no dispute under the

CBA," and, even if there were, "a mere glance or reference to the CBA" would suffice.

Pls.' Resp. Br. 15, dkt. 80.

Plaintiffs' operative complaint alleges broadly that United Parcel "failed and refused

to timely pay Plaintiffs the hourly rates to which [they] are entitled." SAC ¶ 72, dkt. 51. In

their Statement of Claims, Plaintiffs refined their claim, asserting that they "were not paid

at the proper hourly rate according to the collective bargaining agreement." Dkt. 60 ¶ 68

(emphasis added). United Parcel asserts that determination of the proper hourly rate would

require interpreting the following provisions of the United Parcel CBA: Article 17 (com-

pensable time and vacation); Article 33 (cost of living increases); Article 41 (annual wage

increases and wage progression for full-time United Parcel employees); and Article 43

(mileage determinations). Dkt 110-4 at 60, 102, 178, 189.

Beyond their bare contention that there is "no dispute under the CBA," Plaintiffs

offer no persuasive explication for how their claim that they were not paid "according to

the collective bargaining agreement" can be resolved without meaningful interpretation of

the United Parcel CBA. Determination of whether Plaintiffs were in fact paid an hourly

rate commensurate with what (Plaintiffs claim that) the United Parcel CBA provided would

necessarily require undertaking and resolving the parties' disputed interpretations of the

United Parcel CBA, most specifically with regard to the progression provision set forth in

Article 41. Because disputes involving the interpretation of collective bargaining agree-

ments must be resolved in accordance with federal law, we conclude here that the LMRA

preempts Plaintiffs' IWPA claim.

Having concluded that Plaintiffs' sole cause of action lies under § 301, we must

evaluate whether Plaintiffs can maintain an action thereunder. See Smith v. Colgate-

Palmolive Co., 943 F.2d 764, 771 (7th Cir. 1991). On this point, United Parcel asserts that

any LMRA claim is barred by the applicable six-month statute of limitations, which begins

to run when Plaintiffs knew or should have known that the Union breached its duty of fair

representation. Christiansen v. APV Crepaco, Inc., 178 F.3d 910, 914 (7th Cir. 1999). Aside

from a conclusory statement that the statute of limitations argument "misses the mark,"

Pls.' Resp. Br. 16, dkt. 80, Plaintiffs offer no independent analysis—factual or legal. The

Seventh Circuit has repeatedly admonished parties that undeveloped arguments are re-

garded as waived. Marcatante v. City of Chicago, Ill., 657 F.3d 433, 444 (7th Cir. 2011);

White Eagle Co-op Ass'n v. Conner, 553 F.3d 467, 476 n.6 (7th Cir. 2009); United States v.

Berkowitz, 917 F.2d 1376, 1384 (7th Cir. 1991). As such, we regard Plaintiffs as having

waived their response to United Parcel's LMRA arguments. United Parcel is entitled to

summary judgment accordingly.

B. FLSA

The FLSA operates "to protect all covered workers from substandard wages and

oppressive working hours, 'labor conditions [that are] detrimental to the maintenance of

the minimum standard of living necessary for health, efficiency and general well-being of

workers.' " Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 728, 739 (1981) (alter-

ations in original) (quoting 29 U.S.C. § 202(a)). The "FLSA's two core provisions—the

minimum wage provision and the overtime provision—require that employees receive a

minimum wage for each hour that they are 'employ[ed]' as well as a premium wage (one

and one-half times the regular rate of pay) for each hour they are 'employ[ed]' beyond forty

hours in one work week." Dekeyser v. Thyssenkrupp Waupaca, Inc., 735 F.3d 568, 570 (7th

Cir. 2013) (alterations in original) (quoting 29 U.S.C. §§ 206(a), 207(a)). To establish that

an employer has failed to provide overtime compensation, an employee must show that (i)

he worked overtime without compensation; and (ii) the employer knew or should have

known of the overtime work. Kellar v. Summit Seating Inc., 664 F.3d 169, 176–77 (7th Cir.

2011).

An "employee's rights under the FLSA are independent of his rights under a collec-

tive bargaining agreement and . . . cannot be waived by contract." Vega v. New Forest Home

Cemetery, LLC, 856 F.3d 1130, 1133 (7th Cir. 2017) (citing Barrentine, 450 U.S. at 737,

740, 745). Thus, an employee's statutory and contractual rights "must be analyzed sepa-

rately with respect to his right to enforce them in court." Id. at 1133–34. If, however, an

employee's "claim were one relying on his substantive rights under the collective bargain-

ing agreement, there is no question that he would have to exhaust his contractual remedies

by pursuing a grievance or, in the alternative, demonstrate why futility or one of the other

recognized exceptions to exhaustion should relieve him of that obligation." Id.

Plaintiffs here claim that United Parcel violated the FLSA by paying them regular

and overtime rates lower than those to which they were entitled under the United Parcel

CBA. SAC ¶¶ 68–69, dkt. 51; Statement of Claims ¶ 68, dkt. 60. Defendants argue that

resolution of Plaintiffs' FLSA claims requires interpretation of the United Parcel CBA to

determine the correct rate of pay, and, as such, Plaintiffs' overtime claims can only proceed

under the LMRA. E.g., Vadino v. A. Valey Engineers, 903 F.2d 253, 266 (3d Cir. 1990)

(holding that FLSA claims dependent on CBA interpretation must be resolved through

LMRA); Martin v. Lake Cnty. Sewer Co., 269 F.3d 673, 679 (6th Cir. 2001) (same).

Plaintiffs' sole responsive argument is that employees' FLSA rights exist inde-

pendently from and do not require any interpretation of the underlying collective bargain-

ing agreement. See Pls.' Resp. Br. 15, dkt. 80 ("Instead, a mere glance or reference to the

CBA is all that is necessary, and as such, the LMRA does not preempt Plaintiffs' FLSA

claim . . . ."); id. ("There is simply no dispute under the CBA as it relates to Plaintiffs' FLSA

claim . . . , and thus, there is no preemption . . . by the LMRA.").

Certainly, as Plaintiffs maintain, the FLSA protects employees' rights to minimum

wages and overtime compensation—both of which cannot be circumvented by virtue of a

collective bargaining agreement, see Barrentine, 450 U.S. at 745—but Plaintiffs do not

allege that United Parcel violated either of those protections. Their sole grievance that their

remuneration did not comport with their interpretation of the United Parcel CBA does not

translate to a violation of the FLSA, especially where Plaintiffs have asserted neither that

they were paid less than the minimum wage nor that they were paid at an overtime rate less

than one-and-one-half times their regular rate of pay for hours worked beyond forty.8 Given

that "the FLSA contains no language suggesting that an action filed thereunder would be

an appropriate vehicle for the interpretation of a disputed provision of the collective bar-

gaining agreement," we agree with Defendants that the FLSA is not the proper statutory

vehicle to resolve United Parcel's alleged failure to pay them in accordance with the United

Parcel CBA. Vadino, 903 F.2d at 265; see also Vega, 856 F.3d at 1133. Plaintiffs' perfunc-

tory and undeveloped arguments, see Pls.' Resp. Br. 15, dkt. 80, do not persuade us other-

wise and therefore do not forestall entry of summary judgment. Draper v. Martin, 664 F.3d

8 Under the FLSA, overtime pay for all hours worked over forty is calculated using the employee's

"regular rate," which is the hourly rate computed "by dividing [the] total remuneration for employ-

ment . . . in any workweek by the total number of hours actually worked . . . ." 29 C.F.R. § 778.109;

see 29 U.S.C. § 207(a)(1). Plaintiffs' theory here is that their overtime compensation did not com-

port with the United Parcel CBA—not that their overtime compensation was incorrect under the

formula required by the FLSA.

1110, 1114 (7th Cir. 2011) (remarking that courts do "research and construct the parties’

arguments"). United Parcel is entitled to summary judgment accordingly.

CONCLUSION

For the reasons explicated above, Defendants' Motion for Summary Judgment is

GRANTED. Dkt. 72. Defendants’ Motion for Oral Argument, dkt. 84, is DENIED as

moot.

Final judgment shall enter accordingly.

IT IS SO ORDERED.

Date:

9/20/2024 Sud Bus Bink

SARAH EVANS BARKER, JUDGE

United States District Court

Southern District of Indiana

Distribution:

Anthony J. Hornbach

THOMPSON HINE LLP

tony.hornbach@thompsonhine.com

John Timothy McDonald

Thompson Hine LLP

tim.mcdonald@thompsonhine.com

David T. Vlink

Teamsters Local Union 135

dvlink@local135.com

Mark R. Waterfill

ATTORNEY AT LAW

mark(@waterfilllaw.com

27